Don’t Bring out the Champagne yet – DJIA Predicted to Bottom Out at 8200
Last Thursday, after a couple of weeks of steady but relatively normal declines, the Dow suddenly tanked 500 points. Then, after a modest recovery on Friday, it fell 600 points — then it soared 400 points. Then it plunged 500 points — then it blasted off to another 400 point gain.
And Friday August 12, 2011 — after another 100+ point gain, it appears poised to end the week down, but within a couple of hundred points from where it started the week.
This roller coaster week in the markets is what we’re going to see for a while.
Is this wild volatility the start of another massive market crash, along the lines of what happened in 2007-2009, or 2000-2002? Or was it just a ‘Correction‘ — sharp and scary, but now over and done?
Jay Feuerstein’s latest projections — “I don’t think anything has changed — I think the ‘Dow‘ could go down to 8,200 and crude oil to $60 a barrel.”
“Yeah, I’m still sticking with $60,” Feuerstein says when asked about his price target for crude oil, a bearish bet that started when oil was as $115 and is now about $30 or 25% in the money.
While forecasting a further 25% decline in a market that’s already just instantly shed 15% is certainly bold — but he already predicted this move down along with oil a couple of months ago — and his targets have been lowered again.
He thinks the weaker dollar trend will be the key driver for gold and says any time the safe haven trades wanes will be “a great time to buy” — How does $2500 an ounce sound?
Two things that aren’t feeling the pressure from a global slowdown are Treasuries and Gold — with continued strong demand for liquidity that only U.S. Treasuries can offer — the fact is, there really is no where else to park money.
Tags: A Great Time to Buy, Bottom Out, Champagne, Correction, Crude, Crude Oil, DJIA, Dollar, Dow, Forecasting, Global Slowdown, Gold, Jay Feuerstein, Liquidity, Market Crash, Oil, Roller Coaster, Treasuries, US Treasuries